North East digital firms must adopt a similar attitude to those in Silicon Valley if the sector is to reach its full potential, an analyst at one of Europe’s largest tech investment banks has said.

GP Bullhound manages three separate funds, offers strategic advice in business deals and partners with companies undergoing mergers and acquisitions.

The organisation, which is heavily involved in the North East digital sector with offices in Manchester and London as well as overseas, has also developed a reputation as a thought leader in the industry, producing around six pieces of research every year.

This includes an annual report on upcoming tech trends as well the influential European Unicorns report, which analyses what it takes to create a £1bn company.

Luke Burns, who is based at GP Bullhound’s Manchester office, said: “We’re really excited about the North.

“We have found there are some fantastic businesses there and we do not want those companies to sell to the US too early.

“In Europe, growing businesses can sometimes see a £20-£30m cheque and take it - only to see the company grow into a £1bn business.

“We want to see more Unicorns in the North, but to do that we need businesses to be less risk averse.

“They need to stick to their guns and own the business for longer - more like in Silicon Valley.”

Mr Burns added that a direct flight to Silicon Valley would also help put the North on the map as “a real tech hub in Europe”.

“It would see more people coming over here to talk at events and to invest,” he said.

“It would provide that accessibility. It can be too easy for investors to remain in London and not be attracted to the North.”

GP Bullhound, which has produced a Northern Tech Map highlighting the diversity of firms driving innovation in region, estimates there are least 200 tech companies in the North East.

In the Newcastle area alone, it says, around 16,000 people are employed in the sector, providing real potential for growth.

To aid the health of the industry, GP Bullhound hosts regular events, including the Northern Tech Awards, which identifies the leading high-growth tech companies in the North.

In 2014, Newcastle’s Nomad Digital, which provides wireless technology solutions to the transportation, won the Judges’ Award for International Success - and has since gathered further momentum when it comes to high profile contracts overseas.

Tim Rea, chief executive officer of Palringo

The 2015 event, then, highlighted the Cramlington-founded Palringo as the fast growing company, while the Overall Judges’ Award went to Performance Horizon.

“We think the North is making a very big impact in the UK,” Mr Burns said.

“But we think there is a lot more potential for it to do even better and collectively there is no reason why it could not compete with London.

“The North East in particular is a very strong tech hub.

“We would say it is second only to Manchester and, while Sage sets the standards when it comes to enterprise software, it is also very strong in digital media and software services.”

Other areas of the North excelled in different specialisms, he added, giving the Northern Powerhouse a collective force.

The strength of the North East’s universities would also help to nurture talent.

“The skills issue remains but I think it is being addressed,” Mr Burns said.

“There is a danger of people disappearing to London for high profile, highly paid jobs; they could work there all week, then take two hours to get home at the weekend.

“But those with the very best talent are beginning to see the power of the North.”